1997 (10) TMI 149 - AT - Central Excise

Summary

Issues:
Refund claim rejection under Section 11B of the Central Excise Act, 1944 based on time limitation and classification of product "Electronic Game Cartridges" under Chapter Heading 9504.00. Validity of payment made under protest and its impact on limitation period. Interpretation of Rule 233B of Central Excise Rules regarding payment under protest and appeal process.

Analysis:
The judgment involved two appeals concerning the rejection of refund claims totaling Rs. 78,694/- and Rs. 1,40,566.30 under Section 11B of the Central Excise Act, 1944 due to time limitation. The dispute arose from the classification of "Electronic Game Cartridges" under Chapter Heading 9504.00. The appellants had claimed benefit under Notification No. 96/86, which was denied initially but later allowed on appeal. The appellants paid the duty "Under Protest" indicating their intention to challenge the adjudication order. The key issue was whether the payment made under protest could save the limitation period as per Section 11B.

The appellants relied on various judgments to support their position that payment under protest is valid until vacated by a speaking order. The authorities argued that the subsequent refund claims were time-barred as no appeal was filed against the original adjudication orders. The Tribunal considered the proviso to Section 11B, which exempts the limitation period if duty is paid under protest. The Calcutta High Court's decision emphasized the independence of Sections 11A and 11B, supporting the appellants' argument for saving the limitation period due to the protest letter.

The judgment also delved into Rule 233B of the Central Excise Rules, which outlines the procedure for payment under protest. It stipulates that an appeal or revision can be filed within a specified period if available against the order necessitating the duty payment under protest. In this case, since the appellants had already filed an appeal against the previous adjudication, their plea that the payment was made under protest and saved the limitation period was deemed acceptable under Section 11B and Rule 233B.

Ultimately, the Tribunal allowed the appeals, acknowledging the validity of the payment made under protest and directing the lower authorities to determine the aspect of unjust enrichment. The judgment highlighted the importance of complying with procedural rules while emphasizing the significance of payment under protest in saving the limitation period for refund claims.